FSCA investigates EZInvest and Financix over client complaints - IOL
The FSCA said its investigation would establish whether Sanus and the three individuals had contravened financial sector laws.
The Financial Sector Conduct Authority (FSCA) has launched a full investigation into Sanus Financial Services, which operates online trading platforms EZInvest and Financix, following complaints from clients.
The investigation also covers Sanus directors Nicolaas Louw and Bradley Bickham Distras, as well as Annette Smyth, the company's sole key individual. The FSCA stressed that the investigation did not mean that any of these parties had broken any financial sector laws.
Sanus is an authorised financial services provider permitted to provide intermediary services involving derivative instruments and short-term deposits. According to the FSCA, the company provides access to the EZInvest and Financix trading platforms, which offer trading in derivative instruments.
The regulator did not disclose how many complaints it had received or provide details of the allegations. However, it said “given the serious nature and the number of complaints, the FSCA has decided to conduct a full investigation into the matter”.
The FSCA said its investigation would establish whether Sanus and the three individuals had contravened financial sector laws.
These include provisions of the Financial Advisory and Intermediary Services Act, the General Code of Conduct for authorised financial services providers and representatives, and the Fit and Proper Requirements for financial services providers.
Sanus has been an authorised financial services provider since June 2021. The FSCA said: “According to Sanus, it renders intermediary services of access to trading platforms (EZInvest and Financix) which offer trading in derivative instruments.”
Financix offers access to forex trading, stocks, and commodities.
The Financix website describes its offering as execution-only and says transactions are entered into directly with clients at prices displayed on its trading platform rather than being traded on an exchange.
It also warns that contracts for difference, or CFDs, are leveraged products that carry risk.
The investigation comes as the FSCA has stepped up enforcement across the financial sector. In the year to March, the regulator finalised 678 investigations and imposed almost R2.9 billion in penalties, compared with about R120 million the previous year.
Contraventions of the FAIS Act accounted for the bulk of the penalties, at R2.48 billion.
The FSCA also received 7,842 complaints during the year, issued 140 scam alerts, withdrew 14 licences, suspended 31 and debarred 68 people.
FSCA commissioner Unathi Kamlana said the regulator had operated in an increasingly complex financial sector during the year.
"Throughout the year, the FSCA operated in an increasingly complex and rapidly evolving financial sector, requiring us to respond to emerging risks, technological innovation and changing market dynamics while maintaining our focus on fair and effective regulatory outcomes."
The FSCA stressed that the investigation did not mean Sanus, Louw, Distras or Smyth had broken any financial sector laws. It has not yet made any findings and said the investigation remains ongoing.
